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GenMark Shares Rise on Acquisition Rumors

NEW YORK ─ GenMark Diagnostics' shares rose 27 percent to $21.47 in Thursday morning trading on the Nasdaq following a report that it has been approached by potential acquirers.

Investors went on a buying spree after Bloomberg, citing unnamed sources, reported Wednesday evening that Carlsbad, California-based GenMark is working with a financial advisor on a potential sale.

GenMark told 360Dx that in accordance with its policy, it doesn't comment on rumors. 

In a research note on Thursday, Cowen analyst Doug Schenkel said "We have always viewed [GenMark] as an attractive takeover target for larger diagnostics companies" and estimated that a deal in the range of $20 to $25 per share is possible.

He added that GenMark is the "only remaining publicly traded pure-play syndromic testing company of scale."

"It's also worth highlighting that the syndromic testing market remains underpenetrated and should continue to be one of the fastest growing sub-segments within infectious disease molecular diagnostics for the foreseeable future," Schenkel said.

GenMark's competitors include BioMérieux's BioFire, Luminex, and Qiagen.

With cash available as a result of high demand for testing, diagnostic companies are looking carefully at potential acquisitions, according to recent earnings conference calls. Thermo Fisher Scientific announced in January that it plans to acquire point-of-care molecular diagnostics firm Mesa Biotech for up to $550 million.

Also in January, PerkinElmer said it will acquire Oxford Immunotec for about $591 million.